Mayor's Budget Produces Conflicting Conclusions

By MIKE McINTIRE

Published: May 24, 2004

Even as Mayor Michael R. Bloomberg stood at a lectern on April 26 and said there would be no cuts in city spending next year, the City Council had already prepared a two-page list of $220 million in cuts it says are hidden in the mayor's budget.

Who is right?

The answer lies somewhere between two parallel universes, governed by different rules of addition and subtraction, which the mayor and Council seem to be inhabiting this budget season. Where one side sees spending on cultural, health and social services remaining steady or even increasing, the other insists that those very same programs face painful cutbacks.

The dispute over spending is an annual rite for the city's budget. What is different this year is the mayor's insistence that despite what would appear to be reductions in spending in dozens of programs, there actually are no reductions.

''There's no cuts,'' Mr. Bloomberg said in announcing his 2005 budget last month. ''We didn't go and cut anything in this budget that wasn't cut in the last budget. In fact, we've restored a few things.''

Mr. Bloomberg's stance has baffled and angered some Council members and community organizations. While they have come to expect the annual give-and-take over the budget, they said they were surprised by the mayor's argument that his proposed cuts were not really cuts.

''It certainly is an unusual approach to deny your own behavior,'' Gifford Miller, the City Council speaker, said in an interview. ''What's different about it is it's still very real, and the mayor is pretending that it's not.''

Despite the semantic dueling, the budget debate this year, as in the past, will likely resolve itself in coming weeks as both sides seek a compromise before the Council votes on Mr. Bloomberg's $46.9 billion spending plan for the fiscal year that starts July 1. A balanced budget must be enacted by the end of June. Negotiations will begin in earnest after Monday, when a series of Council hearings on the budget is scheduled to conclude.

The annual back and forth over money for services like legal aid to renters, meals for the elderly and child care for the poor -- usually totaling about $200 million, or less than 1 percent of the city budget -- has political benefits for both sides of City Hall.

By not including the money in his initial budget proposal, the mayor gains a bargaining chip for the final negotiations with the Council, when he usually ends up agreeing to restore most of the funds. And the Council scores points with constituent groups by rallying to their defense each budget season.

Meanwhile, for those organizations and agencies that face potential cuts in financing if an agreement is not worked out, the annual theatrics are a recurring lesson in political hardball.

''We do not want to be in the middle of the politics, which is where we find ourselves, sadly enough,'' said Karen Brooks Hopkins, chairwoman of the Cultural Institutions Group, a coalition of arts, history and science organizations based in city-owned facilities, that stands to receive $8 million less next year.

''We understand what the mayor has to do and what the council has to do,'' said Ms. Hopkins, who is also president of the Brooklyn Academy of Music, a member of the coalition. ''But we're really tired of it. Our board's exhausted, and it makes it impossible to plan.''

Doug Turetsky, a spokesman for the Independent Budget Office, a nonpartisan city agency, said groups caught in the annual wrangling are the victims of a budgetary process where conventional rules of arithmetic do not always apply. For them, the mayor's proposals ''look, feel, and smell like a cut, because obviously they fear the money will no longer be there for them.''

''But in pure budget terms,'' he said, ''the money was never there in the first place.''

That is because last year, after Mr. Bloomberg initially proposed cutting $600 million in spending, he agreed to restore about a third of those cuts to this year's budget only. He did not include the restored money in his long-range financial plan for 2005 or beyond.

So this year, when preparing a proposed budget for 2005, the mayor used as his baseline the old spending levels he had submitted prior to last year's one-time restorations. Therefore, when compared to those lower levels, next year's budget contains no cuts, Mr. Bloomberg said.

''We didn't cut our '05 plan,'' said Mark Page, the mayor's budget director. ''We haven't gone into the '05 outlook and deliberately cut back on spending provided for this service or that service.''

That interpretation has Council officials fuming. Larian Angelo, the Council's finance director, said she does not recall similar definitional nuances from previous administrations. Mayor Rudolph W. Giuliani simply acknowledged he was cutting the budget and defended it, she said.

''Budgets are too important to play semantic games,'' Ms. Angelo said. ''This is a reduction in spending from the current year that will impact core city services. There's no other way to look at it.''

She produced a spreadsheet showing that, for instance, by leaving out $10 million for summer jobs, 7,000 young people will not be offered work this year, and a $1.4 million cut at the Sanitation Department means trash collection in the Bronx, Brooklyn, Queens and Staten Island would be less frequent. Mr. Bloomberg did add money in his proposed budget for 2005 to a number of areas. Among the increases are $116 million to support the new policy of retaining poorly performing third graders, $200 million to subsidize the operation of city hospitals and $100 million to comply with the city's new lead abatement law.

Mr. Page said that mayoral administrations generally prefer to hold back some money each year and let the Council bargain for it, rather than put it all in up front and risk having the Council demand still more money.

''There are certain traditions of the budget cycle, and one of them is that the Council gets to allocate some amount of additional money each year,'' he said. ''But as years go by, you can't just keep adding. It doesn't work that way.''